About Target CPA bidding

Target CPA is an AdWords Smart Bidding strategy that sets bids to help get as many conversions as possible at the target cost-per-acquisition (CPA) you set. It uses advanced machine learning to automatically optimize bids and offers auction-time bidding capabilities that tailor bids for each and every auction. Target CPA is available as either a standard strategy in a single campaign or as a portfolio strategy across multiple campaigns and ad groups. This article explains how Target CPA bidding works and what its settings are.

To maximize results and give machine learning algorithms enough data to make informed bidding decisions, we recommend that you have at least 30 conversions in the past 30 days. It also helps if your ad group or campaign has received conversions at a similar rate for at least a few days.

How it works

Using historical information about your campaign and evaluating the contextual signals present at auction-time, Target CPA bidding automatically finds an optimal CPC bid for your ad each time it's eligible to appear. AdWords sets these bids to achieve an average CPA equal to your target across all ad groups and campaigns using this strategy.

Some conversions may cost more than your target and some may cost less, but altogether AdWords will try to keep your cost per conversion equal to the target CPA you set. These changes in CPA take place because your actual CPA depends on factors outside Google's control, like changes to your website or ads or increased competition in ad auctions. Additionally, your actual conversion rate can be lower or higher than the predicted conversion rate.

For example, if you choose a target CPA of $10, AdWords will automatically set your CPC bids to try to get you as many conversions at $10 on average. To help improve your performance in every ad auction, this strategy adjusts bids using real-time signals like device, browser, location, time of day, remarketing list, and more.

Settings

Target CPA

This is the average amount you’d like to pay for a conversion. The target CPA you set may influence the number of conversions you get. Setting a target that is too low, for example, may cause you to forgo clicks that could result in conversions, resulting in fewer total conversions.

If your campaign has historical conversion data, AdWords will recommend a target CPA. This recommendation is calculated based on your actual CPA performance over the last few weeks. We’ll exclude performance from the last few days to account for conversions that may take more than a day to complete following an ad click. You can choose whether to use this recommended target CPA or to set your own.

Tip: Choose what conversions to bid for

The following conversion tracking settings let you customize how you bid for conversions:

The Include in "Conversions" setting lets you decide whether or not to include individual conversion actions in your "Conversions" reporting column. The data in this column is used by bid strategies like target CPA, target ROAS, and ECPC, so your bid strategy will only optimize based on the conversions that you've chosen to include. Learn more

The Include cross-device conversions setting lets you include cross-device conversions in your “Conversions” column and in your conversion-based bid strategies. Learn more

Bid limits

Setting bid limits for your Target CPA bid strategy isn’t recommended, because it can restrict AdWords’ automatic optimization of your bid. It can also prevent AdWords from adjusting your bids to the amount that best meets your target CPA. If you do set bid limits, they’ll be used in Search Network auctions only. Bid limits are only available for portfolio (not standard) Target CPA bid strategies.

Max. bid limit: The highest max. CPC bid that you want AdWords to set for any keywords, ad groups or campaigns using Target CPA bidding.

Min. bid limit: The minimum CPC bid that you want AdWords to set for any campaigns or ad groups using your Target CPA strategy. Note that the AdWords bidding algorithm might set a max. CPC bid that's below your minimum bid limit, generally due to smart pricing. This means that the bid limit that you set here isn't the absolute lowest bid that could be set.

Device bid adjustments

Device bid adjustments for Target CPA allow you to prioritize conversions by device. You can set adjustments for desktop, tablet, and mobile.

Unlike bid adjustments for manual CPC, your bid adjustments for Target CPA modify the value of your CPA target, rather than the bids themselves. For best performance, you may want to remove your manual CPC bid adjustments when switching to Target CPA.

If your target CPA is $10, setting a bid adjustment of +40% for mobile will increase your target CPA to $14 on mobile devices. To prevent your ads from showing on any mobile devices, you can set a mobile bid adjustment of -100%.

Effective target CPA

Your effective target CPA is the average CPA that your strategy optimized for. It includes the average of your device bid adjustments, ad group target CPAs, and any changes you’ve made to your target CPA over time. Because of these variables, your effective target CPA may be different from the target CPA that you set.

This metric lets you measure the CPA that your bid strategy targeted for specific time periods. By changing the date range, you can see what your strategy actually optimized for over that period. Keep in mind, you won’t have an effective target CPA for time periods without traffic.

You can find this metric in your bid strategy report beside your “Cost/conv.”, which represents the actual CPA that this strategy was able to achieve. Effective target CPA is available for both standard and portfolio bid strategies.